Can multiple heirs keep the house instead of selling it?

Short answer: Yes — often heirs can keep the house, but only if they reach an agreement (for a buyout, co-ownership plan, trust, or refinance). If they cannot agree, a court in Montana can order a partition that may force sale. This article explains how that works, what options heirs typically have, and what steps to take.

Disclaimer: This is general information only and not legal advice. Consult a Montana attorney about the specific facts of your situation.

Detailed Answer

1. Who owns the house right now?

When a person dies owning real property, title can pass in different ways depending on how the decedent held title and whether there was a will. Common situations:

• If the decedent owned the home as a tenant in common, the decedent’s share typically passes to heirs or beneficiaries and the heirs become co-owners (tenants in common).
• If title had a right of survivorship (joint tenants with right of survivorship or community property with right of survivorship), the surviving owner(s) may own the entire home automatically.
• If the home is an asset of the decedent’s probate estate, the personal representative will follow the will or Montana’s intestacy rules to distribute the property to heirs.

2. Options for heirs who want to keep the house

Heirs who want to keep the home instead of selling it generally use one of these approaches:

• Buyout: One or more heirs buy the other heirs’ shares. This requires an appraisal or agreement on value and a transfer deed (e.g., quitclaim or warranty deed) and often payment or refinancing to cover mortgages or existing liens.
• Refinance in one heir’s name: If one heir can qualify for a mortgage (or cash-out refinance), they can refinance and pay the other heirs for their shares, thereby removing them from title and the old mortgage.
• Co-ownership agreement: Heirs sign a written agreement about occupancy, management, cost-sharing, maintenance, sale triggers, and exit rules. This can avoid immediate sale but works best when heirs cooperate.
• Place the property in a trust or LLC: Heirs can transfer the home into a trust or an entity controlled by them and adopt rules for use and eventual sale or buyout. This can simplify management and clarify tax and distribution mechanics.
• Rent it and share income: Heirs can keep the house as a rental to produce income and share rental proceeds, while deferring any forced sale. This requires clear agreements and active management.

3. What if heirs can’t agree?

If heirs cannot reach an agreement, any co-owner can typically file a partition action in Montana courts asking a judge to divide the property or order its sale. A partition action is a legal remedy to end co-ownership.

In practice, the court will consider whether the property can be physically divided (a partition in kind). If dividing the land or house fairly is impractical or would harm value, the court can order a judicial sale and divide proceeds among the co-owners according to their ownership shares.

Because partition can result in a forced sale (and court costs and attorney fees), courts and parties often try mediation or settlement first.

For Montana statutes and general code search, see the Montana Code Annotated site: https://leg.mt.gov/bills/mca/. For court self-help information in Montana, see the Montana Judicial Branch self-help resources: https://courts.mt.gov/self-help.

4. Practical issues to handle while keeping the home

• Mortgage and liens: A mortgage does not disappear when an owner dies. A lender can require payment or foreclosure if payments stop. If heirs keep the house, they must ensure mortgage payments and taxes are current or refinance as needed.
• Title and probate: If the home goes through probate, the personal representative must follow Montana probate procedures to transfer title. If the estate qualifies for small estate procedures, heirs may be able to transfer property with less formality. See Montana probate resources at the MCA site above or consult a probate attorney.
• Taxes: Federal tax rules often provide a stepped‑up basis at death, which affects capital gains when the property is later sold. State taxes and property tax reassessments may also apply. Speak with a tax advisor.
• Insurance and maintenance: Co-owners must agree who pays insurance, repairs, utilities, and property taxes. Put agreements in writing to avoid disputes.

5. Typical steps for heirs who want to keep the home

1. Confirm ownership: locate the deed and the decedent’s will (if any); check county records for liens and mortgages.
2. Open communication: talk with co-heirs about goals (keep, rent, sell, or buyout).
3. Get a professional appraisal or market analysis to set a fair buyout price.
4. Explore financing options if one heir plans to buy out others (refinance, home equity loan, or private financing).
5. Document any agreement: use written buyout agreements, co-ownership agreements, or transfers recorded with the county recorder.
6. If no agreement is possible, consider mediation. If mediation fails, be prepared that a co-owner may file a partition action.

6. Costs, timing and risks

Keeping the home can be more expensive and time-consuming than selling immediately. Expect appraisal fees, possible refinancing fees, attorney fees to draft agreements, and ongoing maintenance and tax costs. If a partition action is filed, court time and costs can be substantial and may result in a forced sale at an inopportune time.

Helpful Hints

• Start by identifying the chain of title and any mortgages. Clear information prevents surprises later.
• Get a neutral appraisal before negotiating buyouts; that reduces disputes about value.
• Put any agreement in writing and record deeds with the county recorder to protect everyone’s interests.
• Consider mediation early — it is cheaper and faster than litigation and often preserves family relationships.
• If you plan to refinance, talk to lenders early to learn qualifying requirements and timing.
• Track expenses (repairs, taxes, insurance) carefully if the home will be co-owned and/or rented.
• Consult both an attorney experienced in Montana real estate/probate law and a tax advisor before finalizing any buyout, trust, or sale plan.

Next steps

If you are an heir in Montana and want to keep the house, gather the deed and will (if any), contact all heirs, and speak with a Montana attorney who handles probate and real estate to discuss buyouts, refinancing, or co-ownership agreements. If you fear a partition action, consult an attorney promptly to learn your rights and options.

Remember: This article provides general information about Montana options and procedures; it is not legal advice. Laws change and outcomes depend on specific facts. Contact a licensed Montana attorney to discuss your situation.